Kowloon Development's net profit jumped 414 per cent to HK$1.06 billion last year, thanks to a significant investment revaluation surplus from the distribution of Kowloon Motor Bus (KMB) shares. The property firm's diluted earnings per share rose to HK$2.19 from 42.5 HK cents a year earlier. The final dividend was 18 HK cents per share, unchanged from the previous year. The stock soared 9.21 per cent to close at HK$4.15 yesterday on the profit increase. Kowloon Development's net profit was HK$205 million for 2000. Last year's profit surge was due mainly to the inclusion of a HK$1.13 billion investment revaluation reserve transferred upon the distribution of 52.29 million KMB shares to Kowloon Development shareholders. However, its core property business performance deteriorated slightly and turnover slid 3 per cent to HK$398 million from HK$410 million previously. Profit generated from operations decreased 6 per cent to HK$229 million, compared with HK$244 million a year earlier. Polytec Holdings bought a controlling stake in Kowloon Development for HK$892.6 million at the end of last year. An executive said Kowloon Development would be more active in property development. Last month, Kowloon Development announced it had conditionally agreed to acquire the exclusive development right of a residential project in Ngau Chi Wan from Polytec Holdings. The development right was estimated at no less than HK$1.2 billion. Analysts expected that under the management of Polytec Holdings, Kowloon Development would expand its property business. Kowloon Development's operating income is mainly from long-term leasing properties. Its flagship building Pioneer Centre in Mongkok is estimated to be worth more than HK$2.2 billion. Meanwhile, Polytec Holdings' sister company, Hantec Investment, has recently expressed interest in the Ho Tung Lau residential project in Sha Tin and the Hang Hau station residential development along the Tseung Kwan O railway extension.